Mccoy Global Inc. · TSX:MCB
Mccoy Global — Investor Presentation (January 2016)
28 slides from Mccoy Global's investor presentation, January 2016
Slide 1: Investor Presentation January 2016
Investor Presentation January 2016
Slide 2: Forward Looking Information
Forward Looking Information This presentation contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect“, "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should",
Slide 3: Connection Make-Up and Data Collection Technologies
Connection Make-Up and Data Collection Technologies Making-up reliable connections to support well integrity Hydraulic Power Tongs Typically used by service weCATTTM companies to apply torque to Wireless data make-up / break-out tubular monitoring of torque, on the rig; also included in turns and ho
Slide 4: McCoy's technologies
Connection Integrity McCoy’s technologies control and monitor connection make-up, and collect data to verify connection integrity 4
Slide 5: Global Presence
Global Presence Corporate Head Office Production Facilities R&D Center Western Hemisphere Regional Centers Eastern Hemisphere Optimizing global and regional Regional Centers customer support throughout the equipment lifecycle 5
Slide 6: Global Clients
Global Clients Tubular & Service Threading Companies Manufacturers Contract Rig Drillers Manufacturers 6
Slide 7: Competitive Advantages
Competitive Advantages Broadest platform of Global service and Installed product tubular make-up support base equipment in the market Investing in R&D to Engineered solutions for develop market leading complex applications technologies 7
Slide 8: Operating Environment
Operating Environment 4000 100 World Rig Count WTI ($) 3500 90 3000 80 2500 70 2000 60 1500 50 1000 40 500 30 Rig count data from Baker Hughes 8
Slide 9: Operating Environment
Operating Environment 4000 100 World Rig Count WTI ($) 3500 90 3000 80 2500 70 2000 60 1500 50 1000 40 26.9 29.8 20.8 9.1 Backlog ($ millions) 500 30 9
Slide 10: Quarterly Results ($millions)
Quarterly Results ($millions) Revenue Gross Profit 36% 34% 40% 29% 18% of revenue Earnings from Continuing Operations Adjusted EBITDA 21% 18% 23% 6% 4% of revenue Q2/15 Q3/15 Q3/14 Q4/14 Q1/15 10
Slide 11: Operating in a Challenging Environment
Operating in a Challenging Environment Seasoned Fiscally disciplined management team leadership Board with experience navigating market downturns Strong financial $27 million cash*, no debt position $50 million unutilized credit facility extending to May 2018 International Geographic diversification
Slide 12: Execution of a Global Expansion Strategy
Execution of a Global Expansion Strategy Established presence in the more stable international energy market Spears & Associates Drilling and Production Outlook, December 2015; *Intl. market excludes Russia, China and Central Asia. 12
Slide 13: Execution of a Global Expansion Strategy: Geographic Revenue
Execution of a Global Expansion Strategy Geographic Revenue (based on invoiced customer’s location) 2012* 2013 2014 Countries Invoiced 2014 Management’s Estimates (based on likely product destination) 61 Increased 51 53 exposure to the more stable international market 2012 2013 2014 *Energy Products
Slide 14: Targeting Full Aftermarket Participation
Targeting Full Aftermarket Participation GROWING AFTERMARKET SALES BUILDING CAPITAL EQUIPMENT RENTAL FLEET 14
Slide 15: Long-term Industry Outlook
Long-term Industry Outlook Casing Joints Run Worldwide (millions) A connection occurs an average of every 40 feet of well length Higher pressure/temperature of offshore and deeper onshore wells require premium connections A long (8,000-12,000 ft.) lateral well requires ~200-300 connections Spears &
Slide 16: Strategy: Forging Ahead
Strategy: Forging Ahead • Position MCB to endure an extended downturn Develop lean processes and organizational efficiency • Employ financial strength to pursue the unique acquisition opportunities that may arise given the capital constrained market $27 million cash, no debt $50 million unutilized c
Slide 17: Strategy: Preparing for Opportunities Upon Market Recovery
Strategy: Preparing for Opportunities Upon Market Recovery • Continue to invest in new technologies Develop quick-to-market R&D opportunities • Continue development of Eastern & Western Hemisphere regional locations Enhance service offerings and capabilities to strengthen customer relations Target f
Slide 18: Financial Highlights
Financial Highlights as at December 31, 2015 Share price $2.12 52-week range $2.07 - $5.06 Shares outstanding ~27.7 million Options outstanding ~1.7 million Market capitalization ~$59 million as at September 30, 2015 Cash $26.9 million Debt nil Committed credit facilities $50.0 million Working capit
Slide 19: Company Highlights
Company Highlights Global leader of casing Supporting advancements in casing connection integrity connection Long-term market fundamentals remain unchanged technologies International Geographic diversification to more stable regions presence Improved regional market share opportunities Strong financ
Slide 20: Head Office: Edmonton, AB Canada
Head Office: Edmonton, AB Canada (780) 453-8451 info@mccoyglobal.com www.mccoyglobal.com TSX:MCB, OTCQB:MCCRF
Slide 21: Additional Information
Additional Information
Slide 22: Corporate History
Corporate History ⁄ 1914: Founded in Edmonton, Alberta by H.D. (Henry) McCoy ⁄ 1976: Began machining parts for FARR hydraulic power tongs ⁄ 1986: Acquired FARR Canada ⁄ 1997: Went public on the Toronto Stock Exchange ⁄ 2005: Strategically repositioned the Company toward oil and gas ⁄ 2007: Acquired
Slide 23: Executive Team and Board of Directors
Executive Team and Board of Directors EXECUTIVE TEAM Jim Rakievich, ICD.D President, Chief Executive Officer and Director Jacob Coonan, MPAcc, CA Chief Financial Officer Kenny Watt Senior Vice President Peter Watson, Esq. Vice President, Corporate Development & General Counsel Suzanne Langier, CHRP
Slide 24: Analyst Coverage
Analyst Coverage Canaccord Genuity John Bereznicki Calgary, Alberta Industrial Alliance Securities Elias Foscolos Calgary, Alberta Cormark Securities Sarah Hughes, CFA Toronto, Ontario Paradigm Capital Jason Tucker Calgary, Alberta GMP Securities L.P. Justin Wu, CFA Toronto, Ontario 24
Slide 25: Annual Financial Results
Annual Financial Results Revenue ($millions) Gross Profit ($millions) 120.6 46.2 110.2 40.8 101.8 37.7 2012 2013 2014 2012 2013 2014 37% 37% 38% of revenue 25
Slide 26: Annual Financial Results ($millions)
Annual Financial Results ($millions) Net Earnings from Adjusted EBITDA* Continuing Operations Net Earnings** 21.0 9.9 18.0 9.4 18.5 17.0 7.8 11.8 9.8 2012 2013 2014 2012 2013 2014 2012 2013 2014 18% 15% 17% 0.37 0.29 0.34 0.44 0.37 0.65 of revenue per basic share per basic share *Adjusted EBITDA is
Slide 27: Capital Structure
Capital Structure ⁄ 1997: IPO of ~9.4 million shares at $2/share ⁄ 2002: ~7.3 million shares issued to Foundation Equity to convert promissory note ⁄ 2007: $46.4 million equity raise ~8.85 million shares @ $5.25; Foundation Equity sold $10 million in shares ⁄ 2013: Foundation Equity sale of 5.2 mill
Slide 28: The Anatomy of a Well
The Anatomy of a Well Well Casing Diagram Cement (not to scale) Less Conductor casing Technical Surface casing ~950-3,500 ft Intermediate casing ~10,500 ft Production casing ~13,000 More Technical Production tubing ~14,000-15,000 ft 28